Bangladesh Economic Update, May 2012
Gross Domestic Product (GDP) growth has moderated from 6.7 percent in FY11 to 6.3 percent in FY12 due to unfavorable external economics and internal supply constraints. Monetary policy remained accommodative for most of 2011 but gradual tightening...
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Language: | English en_US |
Published: |
Washington, DC
2017
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Online Access: | http://documents.worldbank.org/curated/en/904361468209659342/Bangladesh-economic-update http://hdl.handle.net/10986/27072 |
Summary: | Gross Domestic Product (GDP) growth has
moderated from 6.7 percent in FY11 to 6.3 percent in FY12
due to unfavorable external economics and internal supply
constraints. Monetary policy remained accommodative for most
of 2011 but gradual tightening is occurring. With the high
fiscal deficit and domestic borrowing by Government,
monetary policy is now bearing the brunt of macroeconomic
policy adjustment. The balance of payments (BoP) is on a
deteriorating track, with reserves falling to below three
months of imports and export growth turning negative in
March 2012. A coordinated policy response is required to
ease macroeconomic pressures and improve growth prospects.
Key actions include the need to create fiscal space, contain
government borrowing to mitigate the risk of crowding out of
credit to the private sector, better regulate the capital
market, and stimulate investment and job growth in the
export sector. Unlike in 2008, Bangladesh has insufficient
policy space to avert the negative impact of a global
slowdown through fiscal stimulus packages and monetary easing. |
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